Summary
Last Friday, the Labor Department released employment data for June. The report showed an unexpected 0.1% decline in the unemployment rate, to 5.0%. Meanwhile, payroll employment growth for the month came in at a reported 146,000, below a consensus forecast that was looking for something around 200,000. Prior months' results were revised upward, however.
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Last Friday's release from the Labor Department indicated an unexpected decline of 0.1% in June's unemployment rate, to 5.0%. The report also indicated an expansion in payroll employment during June of 146,000 jobs, below a consensus forecast that was looking for around 200,000 new payroll jobs. However, upward revisions to April and May data brought the estimate for June into line on a net basis (see below).
The two components comprising each month's employment report are the household survey and the payroll survey. The unemployment rate is derived from the former, making it a visible, highly sensitive number for political purposes.
The payroll survey represents the number generally more important to the immediate behavior of the financial markets, but it also possesses a good deal of political importance. Friday's report indicated job growth of 146,000 during June. This compared with a gain of 106,000 in payroll employment during June of last year.
Friday's release contained upward revisions to April and May payroll job creation, to +292,000 from +274,000, and to +104,000 from +78,000. Thus, including revisions, payroll employment over the last three months grew by 542,000 jobs, versus the 498,000 gain before the April/May net adjustment. (During the same three-month period in 2004, payroll employment rose by 693,000.)
The following table breaks out the reported growth in payroll employment over the trailing three months, versus the same period in each of the prior five years.
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TRAILING THREE-MONTH PAYROLL EMPLOY-
MENT GROWTH (Thousands of Workers)
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Mo. 2005 2004 2003 2002 2001 2000
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June 146 106 27 51 -158 -43
May 78 250 -26 -9 -27 220
Apr. 274 337 -54 -106 -297 285
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Tot. 542 693 -53 -64 -482 462
=== === == === === ===
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For the 12 months ended June 2005, payroll employment expanded by a reported 2.058 million jobs. This compared with an increase of 1.625 jobs during the 12-month period ended June 2004. Over the six-month periods ended June 2005 and 2004, reported growth was 1.088 million and 1.224 million, respectively.
According to Friday's report, average hourly earnings rose three cents during June, or by almost 0.2%, to $16.06. This compared with May's $16.03. The May figure was unrevised from last month's report.
Year over year, average hourly earnings rose 2.7%. This compares with a Consumer Price Index that rose 2.8% for the 12 months ended May (latest CPI data currently available).
During the 12 months ended May, the year-over-year gain in the CPI exceeded the year-over-year growth in average hourly earnings in all 12 of those months, exhibiting the continuing loss of real purchasing power based on these particular series.
The table below contains the latest available results for key employment and inflation series. (NOTE: The new material contained in these tables will be posted to the "Data & Charts" section on the GRA website.)
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KEY U.S. EMPLOYMENT AND INFLATION DATA
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PAYROLL
UNEMPLOYMENT EMPLOYMENT AVERAGE HOURLY
RATE CHANGE EARNINGS
(%) (000s) ($s)
--------------- ---------- -----------------
Month Yr. Yr. Yr. Year/
/Year No. Ago No. Ago No. Ago Year
--------------- ---------- ------------------
06/05 5.0 5.6 146 106 16.06 15.64 2.7%
05/05 5.1 5.6 104 250 16.03 15.62 2.6%
04/05 5.2 5.5 292 337 16.00 15.58 2.7%
03/05 5.2 5.7 122 320 15.95 15.54 2.6%
02/05 5.4 5.6 300 94 15.91 15.51 2.6%
01/05 5.2 5.7 124 117 15.90 15.48 2.7%
=================================================
12/04 5.4 5.7 155 83 15.85 15.45 2.6%
11/04 5.4 5.9 132 96 15.82 15.45 2.4%
10/04 5.5 6.0 282 123 15.81 15.41 2.6%
09/04 5.4 6.1 130 94 15.77 15.40 2.4%
08/04 5.4 6.1 188 2 15.74 15.40 2.2%
07/04 5.5 6.2 83 3 15.70 15.39 2.0%
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EMPLOY. COST INDEX (%)* PRODUCTIVITY (%)#
----------------------- ------------------------
Year Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Yr.
----------------------- ------------------------
2005 0.7 - - - 2.9 - - - -
2004 1.1 0.9 0.9 0.8 3.8 4.1 0.9 2.3 4.0
2003 1.2 0.9 1.0 0.8 3.4 7.2 8.6 2.7 4.3
2002 0.8 1.0 0.8 0.9 7.0 1.1 4.5 1.4 4.3
2001 1.1 1.0 1.0 1.0 -0.4 5.7 1.4 6.5 2.5
2000 1.2 1.0 0.9 0.9 -2.0 7.3 -0.9 4.0 2.7
1999 0.4 1.1 0.9 1.1 3.6 0.5 2.8 7.1 2.8
1998 0.7 0.8 1.0 0.7 3.2 1.2 4.5 2.1 2.8
1997 0.7 0.8 0.8 1.0 -1.2 5.0 3.4 1.6 1.6
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CONSUMER PRICE INDEX## PRODUCER PRICE INDEX@
-------------------------- ---------------------
Month Yr. Year/ Yr. Year/
/Year Index Ago Year Index Ago Year
-------------------------- --------------------
05/05 194.1 188.8 2.8% 153.5 148.3 3.5%
04/05 194.2 187.7 3.5% 154.5 147.7 4.8%
03/05 193.2 187.3 3.2% 153.6 146.4 4.9%
02/05 192.0 186.5 2.9% 152.5 145.6 4.7%
01/05 191.3 185.9 2.9% 151.9 145.7 4.2%
=================================================
12/04 191.2 185.0 3.4% 151.7 145.3 4.4%
11/04 191.2 184.6 3.6% 152.1 144.6 5.2%
10/04 190.7 184.8 3.2% 151.1 144.8 4.4%
09/04 189.6 185.0 2.5% 148.9 144.1 3.3%
08/04 189.3 184.4 2.7% 148.5 143.6 3.4%
07/04 189.2 183.8 2.9% 148.3 142.8 3.9%
06/04 189.3 183.4 3.2% 148.2 142.6 3.9%
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NOTE: All data are seasonally adjusted. *Total
civilian compensation, 3-month change. #Nonfarm
business output per hour, annual rates. ##All
urban, all items. @Finished goods.
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